Metro Phoenix's housing market took a turn for the better last month, and if current trends continue, home prices could start to climb again before the end of the year.
Market experts say now is still too early to declare the beginning of a recovery for the region's battered home values. But the number of successful home sales is at near-record levels, the number of homes for sale is dropping, future foreclosures are in decline and home prices, although low, are holding steady.
The shift in the region's housing market started in March. An upward turn, if one materializes, would be much more significant than just another twist in an ever-changing market. It would mark the end of the worst housing bust metro Phoenix has ever experienced.
Overbuilding during the first half of the past decade preceded a collapse of the American mortgage industry and, later, the global economy. Phoenix-area houses lost more than half their value since the peak in 2006. During the bust, foreclosures soared and home sales dropped. Arizona's economy, long dependent on housing, fell apart.
The years since have seen new construction grind nearly to a standstill. Job losses and foreclosures meant there were many more homes for sale than there were buyers. Prices finally rose slightly in 2010, then fell again as still more foreclosures flooded the market.
That "double dip" has made many market watchers wary of being too optimistic about the latest positive news.
Phoenix real-estate analyst Tom Ruff of the Information Market, a real-estate data firm, said almost all the key market indicators that turned negative during the summer of 2010 and led to the second dip in home prices late last year have now turned positive.